Outsourcing refrigeration: logical solution for Africa

Refrigeration represents a substantial operational cost to companies that use these utilities, and there is a strong case to be made for outsourcing this function to a service provider that will own, operate and maintain the refrigeration infrastructure.

By Dawie Kriel, Head of EP Refrigeration

Energy cost is by far the biggest single component (often more than 60%) of the life cycle cost of refrigeration and this is the one which is not controlled by businesses.

Businesses are prone to wasting a lot of money through additional electricity costs by using refrigeration systems that have become inefficient. Newer, more efficient systems are available, but the capital outlay required to install a state-of-the-art refrigeration system often seems too high in the short term.

The challenges and solutions pioneered in the field of industrial and commercial refrigeration in Africa, should serve as the best arguments for the outsourcing model.

The argument to be made for this is clear: in addition to the significant costs that a company spends on the operation and regular maintenance of modern refrigeration systems, managing refrigeration often diverts precious resources and time away from a company’s core activities.

In spite of this, we still see some of South Africa’s largest users of industrial refrigeration preferring to manage their refrigeration systems with in-house teams with no energy service level agreement. While the notion of outsourced refrigeration has seen some uptake in the country (especially in the retail industry), there is still a lot of room for growth in this space.

The rest of Africa, however, is growing more receptive to the notion of outsourced refrigeration, and this is where the benefits of outsourcing really makes the difference between failure and success.

One of our recent refrigeration contracts in Namibia is a prime example of this, where one of its major retailers has elected to outsource refrigeration for one of its plants as a test case. The two major challenges to running these systems effectively and efficiently, are the vast distances and the shortage of available skills to maintain all of the plant at optimum condition.

The outsourcing solution that we provide includes an online monitoring system, state-of-the-art refrigeration units and a maintenance team that can be on-call to travel between the locations as needed. In addition to energy cost-savings, the most important benefit that these clients will see is a significant improvement in temperature compliance.

The biggest challenges of Africa are infrastructure and skills. Refrigeration systems cannot run without reliable electricity supply and falls apart after a few years if it is not well maintained.

The challenges and solutions pioneered in the field of industrial and commercial refrigeration in Africa, should serve as the best arguments for the outsourcing model.